Fresh bid speculation sent shares in British bank Lloyds TSB surging to its highest level in three years today.
The UK’s fifth-largest bank was in the spotlight again after rumours swept the market linking it with potential suitors from the United States and Europe.
Lloyds TSB declined to comment on the talk but its shares moved to the top of the FTSE 100 Index risers board with a gain of more than 7%. Trading volumes by mid-morning were twice the level seen throughout yesterday.
Dresdner Kleinwort Wasserstein analyst Simon Maughan said there was “idle speculation” in the City of a possible 700p a share bid – worth £39.2bn (€57.5bn) and well above last night’s closing share price of 509.5p. Shares were 38.75p higher at 548p.
Mr Maughan said: “There are some vague rumours that a US bank is preparing a deal, but it is rather vague who the American suitors might be. From a European perspective, Spain’s Banco Bilbao Vizcaya Agentaria is seen as a possible buyer.”
Lloyds TSB has long been seen as a bid target, with US banks Wells Fargo and Bank of America mentioned as possible suitors.